Property tax caps hit counties hard

May 28, 2011

Your editorial "Arundel takes a balanced approach to its budget" (May 26) commends the Anne Arundel County Council and County Executive John Leopold for a "balanced" and "common sense" approach to the county's structural deficit through what you refer to as "the strictest property tax cap in the state."

The council, you say, recently "stared down the no-new-taxes demon" by "upping the property tax 3 cents to 91 cents of assessed value."

If fact, property owners of Wicomico County enjoy — or more to the point, are burdened with — a "tax revenue cap" substantially more onerous and less flexible than that in Anne Arundel.

Following our own "taxpayer revolt" and charter amendment, in 2000, Wicomico's cap permits an increase in revenues from existing properties of no more than 2 percent, or the previous year's CPI change — whichever is less. This compares to Arundel's cap, which permits a 4.5 percent increase.

As a result of revenue capping, when property values soar, the tax rate automatically declines, and there is no effective (or politically acceptable) way for county officials to make up those revenues should values fall.

Wicomico's tax rate for 2010-2011 is a parsimonious 75.9 cents per $100 of assessment — the lowest it has been since 1988.

The consequences have been devastating: School budgets have been slashed and new construction halted. No new roads can be paved, nor can existing roads be repaired. And longtime county employees are being terminated or furloughed.

Memo to the tax-cutters: Be careful what you wish for. You may get it — and not like it very much.

Michael A. Pretl, Riverton

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